What does “Overhead and Profit” include?
Overhead expenses are those costs incurred by the builder or general contractor to operate their business, but are not attributable to any one specific job. We add 10% to cover contractor overhead. Overhead costs can vary significantly from contractor to contractor. Some examples of overhead costs are general and administrative expenses, office rent, utilities, office supplies, salaries for office personnel, depreciation on office equipment, licenses, and advertising. Profit is formally defined as the excess of the selling price of goods over cost. Profit is typically added to the cost of a construction-related job to allow the home builder performing the work to grow their company through reinvestment. We add 10% to cover contractor profit. Profit can vary significantly from contractor to contractor.